Report: If Foreclosures Hit Market, It Won’t be Until 2022
Homeowners in forbearance don’t have to make payments until at least March 2021. After that, a foreclosure may take years to finalize and owners might return to work.
JACKSONVILLE, Fla. – According to a report from Black Knight based on previous natural disaster recovery patterns, mortgage delinquencies aren’t expected to return to pre-pandemic levels until at least March 2022.
Black Knight estimates that once the first wave of forbearances hit their 12-month expiration in March 2021, there may be more than 1 million excess delinquencies once forbearance ends. Looking upon that as if it’s a natural disaster, according to the report, 90-day delinquencies typically peak around three to four months later. In addition, a final foreclosure in Florida can take years since it must go through the court system.
COVID-19 has put upward pressure on serious delinquencies for five months now. In that time, a chasm widened between early stage delinquencies, which dropped 9% in August, and serious delinquencies, which saw a 5% gain in the same month.
Nevertheless, August’s gain marked the mildest increase in five months, suggesting that 90-day mortgage delinquencies could be nearing their peak.
In September’s projected numbers, 88.9% of first-lien mortgage holders made their monthly payment, compared to 88.6% in August and 87.5% in June. Black Knight estimates that the overall national delinquency rate may fall in September if increased payment activity persists during the last week of the month.
Shared by Tom Scaglione, ePRO,SFR, Realtor® A Tampa, Florida native. Serving the Tampa Bay Area for more than 30+ years. (813) 310-8200 with Future Home Realty, Inc. from my Florida Realtors® newsfeed.
The Release and Cancellation of Contract for Sale and Purchase may be used in the event parties agree to cancel an executed contract – but there are a variety of reasons you may not have a fully executed Release and Cancellation. Here are a few examples.
ORLANDO, Fla. – Florida Realtors® has many forms to assist Realtors in their transactions. One of these forms is the Release and Cancellation of Contract for Sale and Purchase, which may be used in the event the parties agree to cancel an executed contract, release each other (as well as the brokerages involved) from liability, and instruct any escrow agent as to disbursement of a deposit(s).
However, it’s important to note: Not all transactions that fail to close will have a version of this form in the transaction file. From a legal perspective, there can be a variety of reasons for not having a fully executed Release and Cancellation. Note that this article does not address any possible MLS rule regarding the necessity of a release and cancellation. (See Dear Anne article, “Release and Cancellation of Contract: What does the MLS say?”)
A few examples:
1. The contract addresses termination and release, and the parties simply choose not to sign one based on the circumstances
Here’s what I mean: Depending on the type of contract you have and the terms, it’s quite possible a Release and Cancellation form isn’t necessary.
For example, assume the parties have a Florida Realtors/Florida Bar “ASIS” Residential Contract for Sale and Purchase, and the buyer cancels during their inspection period. Let’s say they choose to do so on Day 8 of a 15-day inspection period, and the deposit isn’t due until after the inspection period ends. The language in Paragraph 12 of that contract states, in pertinent part, that in order for the buyer to exercise the right to cancel, the buyer “may terminate this Contract by delivering written notice of such election to Seller prior to expiration of Inspection Period … thereupon, Buyer and Seller shall be released of all further obligations under this Contract.”
What does this mean? All the buyer has to do here to cancel the contract is send written notice to the seller before their inspection period ends. That’s it. Written notice could be given in a number of ways, including in the form of an email.
Given the fact that there is no escrow to be released since the buyer cancelled before any deposit was due, there’s nothing the escrow agent should be instructed to release. If you’re the buyer’s agent sending over the written notice of cancellation to the listing agent via email, save that email to the file to show the buyer’s compliance with the contract. In this example, the seller may just move on to the next buyer.
2. The parties don’t agree on disbursement of escrow
In this example, the buyer sends over a Release and Cancellation to the seller indicating that the buyer is to receive the deposit back. However, the seller disagrees, crosses the buyer’s name out, and inserts the seller’s name as the party who should get the deposit.
There is no fully executed Release and Cancellation here as the seller made changes to the form the buyer sent over. Unless they can arrive at some agreement in this example, the Release and Cancellation does little with regards to the transaction other than show that the parties each felt entitled to the deposit. While this can be added to the transaction file as evidence of a disagreement, the form itself doesn’t hold much weight since the parties never arrived at an agreement.
If you are an agent faced with this scenario, make sure to point your respective customer(s) to the dispute resolution section of the contract for the next step if the parties can’t arrive at an agreement.
3. The parties are contemplating litigation
In this example, regardless of any escrow dispute, it’s possible that one (or both) of the parties is upset about the transaction and considering litigation.
If this is the case, the parties (or a party) could refuse to sign the Florida Realtors’ Release and Cancellation based on the waiver of liability section. If a party does sign this form and later decides to sue, execution of this particular form could present a legal barrier for that party.
In sum, while many transactions may contain a fully executed Florida Realtors’ Release and Cancellation form, there will be some that do not for a number of reasons. The important takeaway is to remember that not all transactions are the same, which can result in many different outcomes, including the use – or lack thereof – of a Release and Cancellation document.
You aren’t necessarily going to have all of the same documents in every single transaction and that’s okay! Keeping good records in those situations where there isn’t a Release and Cancellation, whether it be an email, text or written recap of a phone call, is a good business protocol in the event anything comes up later.
Meredith Caruso is Associate General Counsel for Florida Realtors
Shared by Tom Scaglione, ePRO,SFR, Realtor® A Tampa, Florida native. Serving the Tampa Bay Area for more than 30+ years. (813) 310-8200 with Future Home Realty, Inc. from my Florida Realtors® newsfeed.
To all of you Secret Agents out there in MLS land, I have a question…
Why would you put all of your contact information on your business card, including but not limited to, your office phone number, your home phone number, your cell phone number and your email address and give it to complete strangers so they can contact you for business purposes; but, in the MLS you use your office number for both your office and your direct number and further do not keep your email address up to date so another agent who wants to do business with you can’t; because you have become a Secret Agent.
Those of us trying to contact you so we can show one of your listings and/or possibly write an offer on it would like to know. Especially when trying to reach you after hours or on the weekend.
Frankly, it is mind boggling…
Tom Scaglione, ePRO®, SFR®, REALTOR® Future Home Realty, Inc. 13029 W. Linebaugh Ave, STE 101 Tampa FL 33626
C: 813-310-8200
Florida Realtors® Realtor® of the Year in 2018 Greater Tampa Realtors® Realtor® of the Year in 2012
The Real Estate Matchmaker!
Tom@TampaMobileRealty.com
Text: Agent1000 to 72889 For My Electronic Business Card
To all of you Secret Agents out there in MLS land, I have a question…
Why would you put all of your contact information on your business card, including but not limited to, your office phone number, your home phone number, your cell phone number and your email address and give it to complete strangers so they can contact you for business purposes; but, in the MLS you use your office number for both your office and your direct number and further do not keep your email address up to date so another agent who wants to do business with you can’t; because you have become a Secret Agent.
Those of us trying to contact you so we can show one of your listings and/or possibly write an offer on it would like to know. Especially when trying to reach you after hours or on the weekend.
Frankly, it is mind boggling…
Tom Scaglione, ePRO®, SFR®, REALTOR® Future Home Realty, Inc. 13029 W. Linebaugh Ave, STE 101 Tampa FL 33626
C: 813-310-8200
Florida Realtors® Realtor® of the Year in 2018 Greater Tampa Realtors® Realtor® of the Year in 2012
There’s never been a better time to sell a home. Fla. had only a 2.8-months’ supply of single-family homes in the second quarter – the lowest amount since at least 2008. Economists generally consider a six-month supply to be balanced between buyers and sellers.
ORLANDO, Fla. – Florida homeowners: There’s never been higher demand for your home. Economists generally consider a six-month supply of for-sale homes (inventory) to be balanced between buyers and sellers. An inventory greater than six months is a buyer’s market; an inventory less than six months is a seller’s market.
In the second quarter of 2020, Florida’s inventory of homes was 2.8 months.
“Apart from the condo-townhouse category, we are at record lows right now,” says Florida Realtors Chief Economist Dr. Brad O’Connor.
Florida Realtors records sales of condominiums and townhouses separately, and at 5.7-months’ supply in the 2Q, the condo-townhouse market remains in seller territory, but it’s closer to a balanced market.
The coronavirus-related shutdown impacted Florida’s single-family inventory, but more homes now appear to be coming into the market.
Still, demand from buyers, thanks in part to record-low mortgage rates, has not subsided. Selling prices have continued to trend upward as buyers find too-few available homes for sale. In the second quarter, the median price for a Florida single-family home was $277,500 – 4.7% higher year-to-year.
“All indications are that Florida will continue to see home sales surge through the end of the summer, with our biggest near-term issue being a severe lack of single-family inventory,” O’Connor said in the report. “With mid-year inventory levels down over 27% compared to last year, the scarcity of homes on the market will continue to propel prices upward. Price growth has remained so strong throughout the pandemic that at the mid-point of the year, Florida has already seen close to $50 billion worth of closed single-family home sales – less than 2% off last year’s pace.”
The inventory problem isn’t just in Florida. Fannie Mae’s latest U.S. market report found similar conditions nationwide, with a few buyers pulling back as home prices continue to rise.
“Supply constraints appear to be applying upward pressure to consumers’ home price expectations, which in turn has contributed to both a sharp reversal in optimism about whether it is a good time to buy a home and further improvement in home-selling sentiment,” says Doug Duncan, senior vice president and chief economist at Fannie Mae.
Shared by Tom Scaglione, ePRO,SFR, Realtor® A Tampa, Florida native. Serving the Tampa Bay Area for more than 30+ years. (813) 310-8200 with Future Home Realty, Inc. from my Florida Realtors® newsfeed.
Mortgage Rates drop to 2.88%! What are you waiting for? — Call or text Tom Scaglione, ePRO, SFR, Realtor® with Future Home Realty, Inc. at 813-310-8200 Serving the Tampa Bay Area. — “Free List of Homes” at: https://form.jotform.com/201748395020149 — “What’s My Home Worth?” at: https://form.jotform.com/201748531018148 —
